Pension and retirement plan

3 Months Ended

Oct. 01, 2016

9. Pension plan

The Company has a noncontributory defined benefit pension plan (the “Plan”) for which the components of net periodic pension costs were as follows (includes amounts related to discontinued operations):


	First Quarters Ended
	October 1,		October 3,
	2016		2015
	(Thousands)
Service cost	$	10,848	$	10,486
Interest cost		3,774		5,328
Expected return on plan assets		(10,588)		(10,071)
Recognized net actuarial loss		3,851		3,183
Amortization of prior service credits		(393)		(393)
Net periodic pension cost	$	7,492	$	8,533

The Company made contributions to the Plan of $20.0 million during the first quarter of fiscal 2017. The Company expects to make an additional contribution to the Plan of $20.0 million over the remaining three quarters of fiscal 2017.

The Plan meets the definition of a defined benefit plan and as a result, the Company must apply ASC 715 pension accounting to the Plan. The Plan itself, however, is a cash balance plan that is similar in nature to a defined contribution plan in that a participant’s benefit is defined in terms of a stated account balance. A cash balance plan provides the Company with the benefit of applying any earnings on the Plan’s investments beyond the fixed return provided to participants, toward the Company’s future cash funding obligations.

In connection with the completion of the sale of the TS business discussed in Note 3, the Company expects to recognize an immaterial pension curtailment expense as a component of discontinued operations.

Amounts reclassified out of accumulated other comprehensive income (loss), net of tax, to operating expenses during the first quarters of fiscal 2017 and fiscal 2016 were not material and substantially all related to net periodic pension costs including recognition of actuarial losses and amortization of prior service credits.